Ballard Power Systems has agreed to develop fuel cells for Volkswagen Group under a contract worth as much as $100 million.

The deal means Ballard has to design and manufacture fuel cells for Volkswagen HyMotion demonstration cars. The contract is for four years with the possibility of a two-year extension, and is worth between $60 million and $100 million.

"I anticipate accelerating our automotive fuel cell program as a result of this collaborative effort, which will bring together additional fuel cell skills and expertise in both organizations," said Juergen Leohold, head of group research at Volkswagen AG.

Volkswagen has decided to go with Ballard's fuel cells because their cost and performance are finally able to compete with other green technologies.

Ballard's stock increased significantly at the announcement of the Volkswagen deal. On Wednesday, Ballard's stock jumped as high as 82 percent.

"The announcement of this research agreement with Volkswagen Group, a recognized global leader, is a major step for Ballard both strategically and financially," said John Sheridan, Ballard's president and CEO. "Ballard's focus with Volkswagen in this new automotive fuel cell research program will parallel our continuing work in commercial fuel cell markets for backup power and material handling — enhancing product durability and performance while radically reducing product costs."

Volkswagen has been making several green efforts as of late. In January of this year, it launched the largest solar park in the state of Tennessee at 33 acres with 33,600 solar modules.

I find the biggest hurdle to Hydrogen is the thought that it needs to be centrally processed and then shipped to consumers. Why use that method for something as readily available and abundant as Hydrogen? It would make far greater sense to either have every station or a central local hub providing for the area. Trucking it across the country is asinine for Hydrogen but seems to be what people currently think needs to be done.

If memory serves, Ballard and/or others put forth the idea of having the "fueling station" in your house, since hydrogen is readily available in the form of water. Granted this was back in 2000 when they had their initial contract with Ford and Mercedes. Who knows if this is as viable as say installing a charging station for an electric car though.

No, hydrogen is not readily available in the form of water. Water is the end product - it's at a low energy state. Hydrogen gas, methane, sugar, alcohols, petroleum all have hydrogen in a high energy state. The energy you get from "burning" hydrogen (whether in an engine or a fuel cell) is what's released when you move hydrogen from a high energy state to a low energy state. Converting hydrogen from a low energy state to a high energy state requires putting in more energy than you plan to use, due to efficiency losses.

A "home fueling station" using water as its hydrogen source only works if you put the energy into the water to liberate the hydrogen. If you do it electrically, that's about 60% efficient at best. Most of our electricity is generated from coal which is about 40% efficient. Non-research hydrogen fuel cells are about 70% efficient. So the net efficiency of that chain is 40%*60%*70% = 17%, or nearly half the efficiency of a gasoline engine. We'd actually increase global energy consumption and greenhouse gas emissions if we tried to replace gasoline engine cars with this.

So you can't use the hydrogen in water as a fuel. (Unless you want to go to some of the more exotic reactions like with magnesium or sulfur, which yield end products with hydrogen at an even lower energy state. But those require large amounts of energy to produce the elemental magnesium and sulfur. TANSTAAFL

There is a viable scenario where using water makes sense in spite of the thermodynamic inefficiency. If a nuclear reactor supplies the electricity, then the process still has about the same overall energy efficiency, but now makes sense. In fact, if a nuclear reactor is dedicated to hydrogen production, then it can directly supply the DC current with DC, rather than the usual AC, generators and have considerably better overall energy efficiency. A 1 GW nuclear facility could generate a considerable amount of hydrogen from water with zero greenhouse emissions.

There is always the question of efficiency. About 10 years ago, when I heard some lectures on hydrogen as an energy carrier, the most power-efficient ways to generate hydrogen all involved either very high energy and pressure, or toxic process chemicals.

If a fuel-truck needs to burn 100Kg of hydrogen to transport 10 tons of hydrogen, all you need is 1% more efficiency to make this process the overall more efficient one.

If you want to ship lots of hydrogen around try attaching it to carbon ;).

But you need practical and affordable:1) hydrocarbon fuel cells2) methods of getting hydrocarbon fuels that do not "poison" the fuel cells. Whether the hydrocarbons come from the ground or are synthesized contaminants can be a problem.

- Liquid at room temperature and normal atmospheric pressure.- Relatively benign if you happen to spill a bunch of it.- High energy density (not as high as gasoline but close).- Burns relatively cleanly, much cleaner than petroleum.

The problems are:

- Fuel cells which take alcohol are less efficient, destroying much of the advantage of fuel cells over combustion engines.- I don't think a way has been developed to "manufacture" it from carbon, hydrogen, oxygen, and energy. All methods involve plants converting the C, H, and O to sugars, which are then fermented by bacteria to produce alcohol.